Strong U.S. dollar makes Latin America a bargain for tourists, a potential boon for the region

North AmericaUpdates

Oct 19. The economic outlook for Latin America and the Caribbean for the rest of the year, and 2023, looks grim, but there is one potential bright spot thanks to the unusual strength of the U.S. dollar — tourism.

That was one of my main conclusions after talking with Ilan Goldfajn, the head of the International Monetary Fund’s Western Hemisphere Department, earlier this week.

The IMF forecasts that the economies of Latin America and the Caribbean will grow by only 1.7% in 2023. That’s about half the region’s estimated growth for this year, and less than the projected economic expansion of China, India, sub-Saharan Africa and other parts of the developing world.

But when I asked him which Latin American and Caribbean countries will do best, he said that, “The ones that will grow the most are the Central American and Caribbean countries that depend on tourism.”

Indeed, the strong U.S. dollar is helping tourist destinations and could be a boon for the entire region. While a strong dollar makes it more expensive for Latin Americans to travel abroad, import goods and pay foreign debts, it gives them a rare opportunity to attract more U.S. and European tourists with bargain prices.

Source: Miami Herald


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